Alfi, Inc. (ALF, ALFIW) Failed to Disclose Deficient Disclosure Controls and Internal Control over Financial Reporting
A class action was filed on behalf of all persons and entities that purchased Alfi, Inc. (NASDAQ: ALF, ALFIW) common stock or warrants pursuant to the Company’s May 4, 2021 initial public offering (“IPO”) or securities between May 4, 2021 and November 15, 2021. The complaint alleges violations of the Securities Act of 1933 and Securities Exchange Act of 1934. Alfi provides interactive artificial intelligence and machine learning software solutions.
According to the complaint, Alfi began trading publicly on May 4, 2021. However, the documents filed in support of the IPO (the “Offering Documents”) were negligently prepared. Specifically, the Offering Documents failed to disclose that Alfi maintained deficient disclosure controls and procedures and internal control over financial reporting. As a result, the Company and its employees could and did engage in corporate transactions and other matters without sufficient and appropriate consultation with or approval by the Company’s Board of Directors. This increased the risk of internal and regulatory investigations into the Company and its employees.
On October 28, 2021, Alfi disclosed that the Board had placed the Company’s Chief Executive Officer, Chief Technology Officer, and Chief Financial Officer “on paid administrative leave and authorized an independent internal investigation regarding certain corporate transactions and other matters,” and had subsequently terminated its Chief Technology Officer. Then, on November 1, 2021, Alfi disclosed its Chair of the Audit Committee had resigned from the Board and that its internal investigation resulted from “the Company’s purchase of a condominium for a purchase price of approximately $1.1 million” and “the Company’s commitment to sponsor a sports tournament in the amount of $640,000,” both of which “were undertaken by the Company’s management without sufficient and appropriate consultation with or approval by the Board.”
On November 15, 2021, Alfi disclosed it “received a letter from the staff of the [SEC] indicating that the Company, its affiliates and agents may possess documents and data relevant to an ongoing investigation being conducted by the staff of the SEC.” Further, the Company should preserve documents that “relate or refer to the condominium or the sports tournament sponsorship identified in the Company’s Current Report on Form 8-K filed on November 1, 2021, or financial reporting and disclosure controls, policies or procedures.”
Finally, on November 16, 2021, Alfi filed a notice of its inability to timely file its quarterly report on Form 10-Q with the SEC for the quarter ended September 30, 2021. The stock now trades under $3.00.
If you purchased shares of Alfi, Inc. (ALF, ALFIW) stock or warrants pursuant to the Company’s IPO or securities between May 4, 2021 and November 15, 2021, you have until January 31, 2022, to ask the court to appoint you lead plaintiff for the class.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.